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The Environmental Protection Agency chose not to revise the permitting
thresholds for greenhouse gas emissions in a final rule released
July 3, but it did approve plantwide applicability limits for industrial
facilities.

New facilities that emit 100,000 tons per year of carbon dioxide-equivalent
and existing facilities that increase their emissions by 75,000 tons per year of
carbon dioxide-equivalent will be required to obtain prevention of significant
deterioration and Title V operating permits.

EPA said it is retaining those existing permitting thresholds because state
permitting authorities need more time to develop the infrastructure necessary to
issue greenhouse gas permits.

“Instead, in many cases, reductions in state environmental agency budgets
have occurred, which is fully consistent with the overall reductions in state
budgets that have been recently seen across the nation,” EPA said.

EPA plans to complete a study of the administrative burdens associated with
the permitting requirements by April 30, 2015. The next review of the permitting
thresholds is due to be completed by April 30, 2016, and EPA could revise the
thresholds then.

Environmental Groups Urged Lower Thresholds.

Environmental groups had urged EPA to lower the permitting thresholds in
their comments on the proposed rule. However, David Doniger, policy director of
the Natural Resources Defense Council's Climate Center, told BNA July 3 that
environmental groups generally support EPA's decision to address the largest
emissions sources first. They will be closely watching EPA's review process in
2016, he said.

“Certainly, this holding things level knocks the legs out from under the
feverish claims that EPA was on the march to get to hotdog stands,” Doniger
said. “This signals that there's great reluctance on EPA's part to get beyond
the largest sources.”

Maintaining the permitting thresholds through 2016 does give industry groups
some certainty to begin planning investments, Howard Feldman, director of
scientific and regulatory affairs at the American Petroleum Institute, told BNA
July 3.

“It does definitely provide more certainty over that time period,” he
said.

EPA Tailoring Rule Steps

• The
first step of EPA's tailoring rule, which took effect Jan. 2, 2011, required
sources that were already subject to prevention of significant deterioration
requirements to obtain permits for their greenhouse gases if they emit 75,000
tons of carbon dioxide-equivalent a year.

• Beginning
July 1, 2011, the second phase applied permitting requirements to all stationary
sources with greenhouse gas emissions of at least 100,000 tons of carbon
dioxide-equivalent annually or that made modifications increasing their
emissions by at least 75,000 tons per year. The requirements applied to sources
even if they were not previously subject to permitting for other pollutants.

• EPA
chose not to revise those permitting thresholds for the third step of the
tailoring rule. That will allow EPA and states more time to develop the
necessary infrastructure to issue the permits and develop measures to ease the
burden on regulators and industrial facilities.

• EPA
plans to complete a study of the administrative burdens of the permitting
program by April 30, 2015. The next review of the permitting thresholds is due
to be completed by April 30, 2016, and EPA could revise the thresholds then.

The final rule is the third step in EPA's implementation of prevention of
significant deterioration permitting for greenhouse gases.

The first step, which took effect in January 2011, required only those
sources that were already subject to prevention of significant deterioration to
obtain permits for their greenhouse gas emissions if they emit 75,000 tons of
carbon dioxide-equivalent a year. Under the second step, effective in July 2011,
all sources that emit 100,000 tons per year of carbon dioxide-equivalent and
those that increased their emissions by 75,000 tons per year were required to
obtain permits.

The final rule will revise 40 C.F.R. Part 52. It will take effect 30 days
after it is published in the Federal Register.

Agency Allows Plantwide Permits.

Retaining the permitting thresholds will give states and EPA additional time
to develop streamlined permitting approaches.

One streamlining option included in EPA's final rule will allow industrial
facilities to obtain site-specific permits for their plantwide greenhouse gas
emissions rather than for specific emissions points.

The permits can be issued on either a tons-per-year or a carbon
dioxide-equivalent basis. The plantwide limits will allow those sources to make
some modifications to their facilities without triggering the prevention of
significant deterioration permitting requirements.

The final rule also will allow industrial facilities that are considered
minor sources for other regulated pollutants but emit 100,000 tons per year of
greenhouse gas emissions to retain their minor source status. That would exempt
them from the more stringent major source emissions controls requirements.

“We believe that these actions could streamline PSD permitting programs by
allowing sources and permitting authorities to address GHGs one time for a
source and avoid repeated subsequent permitting actions for a 10-year period,”
EPA said.

EPA chose not to finalize a provision that would have allowed sources in
areas subject to federal implementation plans for greenhouse gases to obtain
synthetic minor permits for their emissions. EPA chose not to finalize the
option because commenters said it was not needed at this time.

Synthetic minor permits establish emission limits below the current
prevention of significant deterioration thresholds but would be less complicated
to obtain than a traditional permit.

Streamlining Options Being Considered.

EPA said it is considering other streamlining options such as setting
emissions controls for various industrial sectors that can be presumed to be the
best available control technology, encouraging the use of general permits, and
encouraging electronic permitting.

Many of the streamlining approaches “will take several years to develop,
requiring separate rulemaking both at the federal level, and then through state
and local processes," EPA said.

EPA also has created a Clean Air Act Advisory Committee work group to explore
options for easing the permitting burdens on states and industries. The work
group is expected to report back to the agency in October.

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